Obama denies Keystone XL permit; TransCanada responds

The denial of TransCanada Corporation’s more than 800,000 bbl/d project will make it more difficult for producers to develop the province of Alberta’s oil sands.

The US$8 billion infrastructure project would have linked existing pipeline networks in Canada and the United States to bring crude from Alberta and North Dakota to refineries in Illinois and, eventually, the Gulf of Mexico coast.The proposed 1,897 km, 36 inch diameter pipeline would run from Hardisty, Alberta to Steele City, Nebraska.

TransCanada first sought the required Presidential Permit for the cross-border section in 2008, but the pipeline has since suffered delays.

Last week, TransCanada asked the Obama administration to pause the review, based on the fact that the company had applied to the Nebraska Public Service Commission for approval of its preferred route in the state.

Earlier this year, the Republican-controlled US Senate passed a bill that would have allowed Congress to decide on the pipeline, legislation Obama vetoed.

Canada’s National Energy Board deemed the pipeline as being in the public interest in March 2010.

TransCanada responds

TransCanada Corporation has announced it will review all of its options in light of the permit denial. Those options include filing a new application to receive a Presidential Permit for a cross border crude oil pipeline from Canada to the US.

“TransCanada and its shippers remain absolutely committed to building this important energy infrastructure project,” said TransCanada President and Chief Executive Officer Russ Girling.

“We will review our options to potentially file a new application for border-crossing authority to ship our customer’s crude oil, and will now analyse the stated rationale for the denial.”

Mr Girling points out that TransCanada continues to have the support of American and Canadian workers, labour organisations, industry and the American and Canadian people. He added that with their continued support, the company believes that a pipeline will eventually be built as this is the safest, most economically efficient means of getting crude oil to market.

The company released a statement saying that the permit denial compromises the environment, economy, jobs and public safety in the US and Canada.

“Today’s decision deals a damaging blow to jobs, the economy and the environment on both sides of the border,” the statement says.

“Through the course of its review, the US State Department issued five very comprehensive and balanced scientific reviews of Keystone XL since 2010. Tens of thousands of pages of evidence from its own employees and agencies irrefutably show Keystone XL is the safest, most environmentally sound way to transport needed energy to Americans.”

You can view the full statement here.

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